Schwab Advisor Services Study Finds Investment Advisors Should Not “Pink Up” Their Approach for High Net Worth Women

Investment performance edges out long-term planning in terms of greatest importance to women; nine in ten women neutral about the gender of their investment advisor

SAN FRANCISCO--()--High net worth (HNW) women place great importance on investment performance and influence or drive many household financial decisions, according to the new Women and Financial Independence Study released today by Schwab Advisor Services. Conducted to provide independent investment advisors with information on how best to serve the growing population of HNW women, the survey finds that 65 percent of respondents consider themselves financially independent and that women consider continuous, good investment performance more important than having a long-term financial plan (58% versus 39%).

That is not to say that planning isn’t important to HNW women. The survey, of 500 women between the ages of 30 and 70 years old with average investable assets of $1.3 million, finds that women want their advisors to consider their long-term financial needs (84%), whole financial picture (82%), current life stage (70%) and even their children’s financial needs (35%). However, 40 percent of respondents also want advisors to take into consideration their immediate need for return on investments.

“Advisors will win the trust of women investors and build long-term working relationships by understanding as much about what women don’t want, as what they do want. Women, like any serious long-term investor, want advice that is intended for their specific financial situation, long-term plans for their desired lifestyle, and accountability in terms of investment performance against goals,” said Bernie Clark, executive vice president and head of Schwab Advisor Services. “We feel that advisors who excel in these areas will be most successful when it comes to working with high net worth women.”

Women help call the financial shots

While HNW women are clearly decision makers in their own right, shared decision making with their spouse/partner is also highly valued. For instance, 93 percent of those surveyed consider themselves the primary or shared decision maker for household finances (budgeting, bill paying) and 84 percent for investments. In addition, 68 percent – both single and married - believe that responsibility for financial matters should be handled equally by a couple. And respondents also want a collaborative relationship with their advisors, with 88 percent wanting to have a say in how an advisor invests their money.

The study also finds that married HNW women share most household financial decisions with their spouses/partners. This includes retirement planning (67%), health/medical (64%), investments (62%), home maintenance (56%), household budgeting (56%), and children’s education (51%). That said, a third (29%) of married women say that they would like to be more involved in the financial decisions for their household. And while the majority (82%) has a joint or shared checking account, many also have assets in their name alone, including 75 percent with their own retirement account, 59 percent with credit cards, and 49 percent with an investment account.

Three quarters of the women surveyed have an advisor, and of these, 25 percent chose the primary financial advisor themselves and 37 percent made the decision together with their spouse/partner.

Gender of advisor matters less than age

Women are generally agnostic (87%) about whether their advisor is male or female.

“This study underscores that there is an equal opportunity for all advisors to serve this growing market,” said Clark. “Gender doesn’t set an advisor apart for these women. What does is the advisor’s ability to meet the high net worth woman’s needs and establish trust through a combination of planning, high-touch communication and demonstrated results.”

Interestingly, half of the women surveyed (53%) express a preference regarding the age of the advisor, with a fair number preferring an advisor in their 40s or 50s (22% and 25% respectively). Forty-seven percent had no age preference.

Face time critical to gaining trust of HNW women

Even in an age of social media and technology, women still value face-to-face communications with 84 percent saying that in-person meetings are important for establishing trust. Women want in-person meetings for everything from the initial interview (78%) and long-term financial planning (60%), to estate planning (57%) and portfolio allocation (39%). On a related note, in the case of married women, 89% consider it somewhat or very important that the advisor meet with the couple together when investments are shared.

In cases where women don’t prefer an in-person meeting, they are more likely to opt for communication by phone than by email, as is the case when it comes to questions about their statement (52%), a specific investment (42%) and market conditions (36%). However, younger women do opt for email more often than their older counterparts.

About the Women and Financial Independence Study

The Women and Financial Independence Study was conducted for Schwab Advisor Services by Koski Research using online panel sources. Koski Research is not affiliated with nor employed by Charles Schwab & Co., Inc. Detailed findings can be found at www.aboutschwab.com/press/research. All data is self-reported by study participants and is not verified or validated. The study looked at 500 women between the ages of 30 and 70 years old with average investable assets of $1.3 million. Individuals participated in the study between May 25 and June 4, 2012.

About Charles Schwab

The Charles Schwab Corporation (NYSE:SCHW) is a leading provider of financial services, with more than 300 offices and 8.7 million active brokerage accounts, 1.5 million corporate retirement plan participants, 815,000 banking accounts, and $1.76 trillion in client assets as of May 31, 2012. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC, www.sipc.org), and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through its Advisor Services division. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides trust and custody services, banking and mortgage services and products. More information is available at www.schwab.com and www.aboutschwab.com. Investment products offered by Charles Schwab & Co., Inc. are not insured by the FDIC, are not deposits or obligations of Charles Schwab Bank, and are subject to investment risk, including the possible loss of principal invested. (0612-4359)

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© 2012 Charles Schwab & Co., Inc. (Member SIPC) All rights reserved.

Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50326073&lang=en

Contacts

Charles Schwab
Lindsay Tiles, 415-667-0479
lindsay.tiles@schwab.com
or
The Neibart Group
Sarah Gormley, 718-875-2122
sas@neibartgroup.com

Bernie Clark, executive vice president and head of Schwab Advisor Services. (Photo: Business Wire)

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Contacts

Charles Schwab
Lindsay Tiles, 415-667-0479
lindsay.tiles@schwab.com
or
The Neibart Group
Sarah Gormley, 718-875-2122
sas@neibartgroup.com